TAIPEI: The Executive Yuan, Taiwan's Cabinet, has given the green light to a new initiative aimed at encouraging small and medium-sized enterprises (SMEs) to increase the wages of their employees. This plan, approved on Thursday, is part of the government's broader strategy to enhance domestic salary levels and support economic growth.According to Focus Taiwan, the approved plan includes offering additional credit guarantees to SMEs through the Small and Medium Enterprise Credit Guarantee Fund of Taiwan (Taiwan SMEG). This initiative will provide an additional NT$35 million (US$1.09 million) in financing to SMEs that commit to raising salaries, with guarantee percentages reaching up to 95 percent. Moreover, the service fees imposed by Taiwan SMEG will be significantly reduced, going as low as 0.1 percent, as detailed in a statement released by the Cabinet on Thursday.Taiwan SMEG operates as a non-profit legal entity under the Ministry of Economic Affairs, providing financial access to guarantee-eligible S MEs through banks. Beyond credit guarantees, the government is extending its support to micro, small, and medium-sized enterprises (MSMEs) with fewer than 30 employees by offering preferential loans and favorable tax rates. These measures are part of a comprehensive program to promote the development and competitiveness of Taiwan's MSMEs, including aiding their digital transformation.Additionally, the Cabinet has announced NT$100,000 in subsidies for businesses with fewer than 30 employees. This financial assistance aims to mitigate the impact of the increased monthly minimum wage and facilitate digital skills training for employees, thereby enhancing productivity. Furthermore, enterprises that experience revenue growth and provide pay raises will benefit from increased government subsidies, a measure anticipated to aid over 600,000 companies, as indicated in the Cabinet's statement.